Hybrid cars have been a favorite of high-mileage drivers for a while now. The touted gas savings and increased price of gasoline has led to much higher adoption of hybrids over the last few years. However, hybrids aren’t the best solution for everyone. The question is, when do the upfront costs of buying a more expensive hybrid car actually work out in your favor?
Here’s how to tell if a hybrid will save you dough
You could certainly take the time to run your own scenarios or put together a spreadsheet for how quickly a hybrid purchase would pay back. Obviously, if you drive fewer miles than most, buying a hybrid won’t make nearly as much sense for you. But if you are interested and just aren’t sure if it’s the right move, crunching the numbers is the best place to start.
Some of us are just plain awful at math though. And the good news is that the Environmental Protection Agency has put together a tool that helps you figure out how long it will take for a hybrid purchase to pay you back. The estimates are based on driving 15,000 miles annually at $2.66 a gallon for regular fuel. These numbers can help you figure out, with a little tweaking, how quickly a hybrid will pay off in your specific scenario.
Although this tool can be helpful for figuring out some basics, there are a lot of factors that aren’t included. For instance, resale value and insurance costs aren’t factored in at all.
It’s wise to call your insurance company before any new car purchase so you can know what the cost differences will be up front. And let’s say that this EPA tool informs you that it will take 5.7 years for your hybrid to pay back the extra up-front cost in fuel savings — you’ll still likely have a car that’s worth more than its non-hybrid counterpart after that period. Be sure to factor that added value in yourself.
By the way, if you’re currently interested in purchasing a hybrid, it turns out that now is a great time to do it. As always, buying it used is still the best recipe for saving the most on a vehicle purchase.